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Lakewood rabbi pleads not guilty to charges he stole from SCHI

NEW BRUNSWICK - Rabbi Osher Eisemann, the founder of the School for Children with Hidden Intelligence in Lakewood, pleaded not guilty Monday to charges that he stole hundreds of thousands of dollars from taxpayers.

Lakewood rabbi pleads not guilty to charges he stole from SCHI

Rabbi Osher Eisemann, founder and director of Lakewood's SCHI school, is shown with attorneys during his arraignment at the Middlesex County Courthouse in New Brunswick Monday, April 24, 2017. (Photo: Thomas P. Costello)Buy Photo

NEW BRUNSWICK - Rabbi Osher Eisemann, the founder of the School for Children with Hidden Intelligence in Lakewood, pleaded not guilty Monday to charges that he stole hundreds of thousands of dollars from taxpayers.

Eisemann was indicted earlier this month by a state grand jury on charges of stealing more than $630,000 of public funds and laundering much of the money.

Eisemann, 60, of Lakewood, is also the current director of the school, better known as SCHI (pronounced "shy"). The charges against him include theft by unlawful taking, misapplication of government property, misconduct by a corporate official, and money laundering — all second-degree offenses that carry up to 10 years in prison and a fine of up to $150,000, state Attorney General Christopher Porrino has said.

The school's fundraising foundation, the nonprofit Services for Hidden Intelligence, LLC, was also named in the indictment under the same charges. Attorneys for the foundation entered a not guilty plea on Monday. The school itself was not charged in the indictment.

In court Monday, the state offered Eisemann a plea deal, saying that if he would plead guilty to theft by unlawful taking, the state would drop the other charges and only pursue a five-year prison sentence. Eisemann and his attorney both declined comment after Monday's arraignment, so it's unclear if they will consider the plea deal.

Eisemann's attorney, Lee Vartan, said, "If there came a time where him remaining director of the school would jeopardize its mission, he'd be the first to step away."

State Department of Education officials have declined to comment on how Eisemann's indictment will affect the millions in public funds paid to the school each year.

SCHI receives around $1.8 million each month from Lakewood and surrounding districts that send students to be educated at SCHI, Porrino said. The other districts include Toms River, West Long Branch and Edison.

This school year, Lakewood's public school district paid $22.9 million to SCHI, or about $127,222 per day based on an 180-day school calendar, according to David Shafter, a state-appointed monitor of Lakewood's school district. In a 2012 audit, state inspectors found that the school overcharged taxpayers $340,000 and hired 71 employees without background checks. The school is appealing the findings.

The school serves children with a variety of disorders, including autism, cerebral palsy and Down syndrome. The school has consistently been ranked by the state as one of the top special-education schools.

SCHI now cares for more than 600 students between the ages of 3 and 21. The school was started by Eisemann in a storefront on Route 9 in 1995 with just a handful of students. The school has said in the past that it plans to eventually have more than 1,000 students.